Stablecoin issuer Tether Limited has joined a coalition of investors to develop the biggest Bitcoin mining organization in the world in El Salvador.
Bitcoin miner, Volcano Energy said on Monday it had secured $1 billion in commitments to construct a 241 megawatt (MW) bitcoin mining facility in the Metapán region of El Salvador.
The mining site will be powered by a combination of 169 MW of solar energy and 72 MW of wind energy. This renewable energy infrastructure will enable the mining facility to achieve a computing power exceeding 1.3 exahash per second (EH/s).
Volcano stated that the government of El Salvador will have a significant involvement in the planning and implementation of the project, playing a crucial role. As part of its involvement, the government has secured a preferred participation that is equivalent to 23 per cent of the project’s revenues.
External investors will own 27 per cent of the venture, while the remaining 50 per cent will be reinvested by the company to enhance energy production capabilities and expand mining capacities.
The energy consumption associated with running the Bitcoin network has been a contentious issue for more than a decade. The energy-intensive mining process has been criticized as it consumes electricity comparable to that of small countries, leading many to view it as a wasteful use of resources.
In response to this criticism, miners have been actively working towards sourcing their energy from renewable sources. This shift aims to enhance the efficiency of the process and improve its public perception. Renewable energy options, including hydroelectric power, have gained popularity due to their potential to offer some of the lowest energy rates globally, depending on the geographical location.
“Currently, more than 52 per cent of Bitcoin mining is being done sustainably,” said Josue Lopez, CEO at Volcano Energy.
“We believe this percentage will significantly increase in the coming years through important investments like ours. Not only is ‘Volcano Energy’ important for the future of Bitcoin resiliency, it’s also an important sign of the new crucial role that El Salvador plays in the global tech environment.”
Tether Energy is doubling down on #bitcoin with our investment into Volcano Energy in El Salvador 🌋🇸🇻 We're fueling sustainable Bitcoin mining and supporting El Salvador's economic growth🍊⛏️
Learn more 👉 https://t.co/PlJ2yRhPR8 pic.twitter.com/fnpWuZW95t
— Tether (@Tether_to) June 5, 2023
Read more: CoinEX launches first crypto trading platform in Hong Kong since 2021 crackdown
Read more: US Bitcoin buys mining assets from bankrupt Celcius Network
North American crypto climate pushes development away
While previous mining initiatives in El Salvador have focused on its geothermal energy potential, it remains uncertain how this new solar and wind energy park will be linked to volcanic activity. Volcano mentioned that this mining site is intended to pave the way for a geothermal future, but did not provide specifics about the roadmap.
Paolo Ardoino, chief technology officer of Tether, stated that Volcano Energy represents one of the most groundbreaking initiatives backed by the stablecoin issuer as it seeks to diversify its strategic ecosystem. Tether has recently been active in investments related to bitcoin mining in Uruguay and acquiring bitcoin to bolster its reserves supporting USDT.
Due to limited opportunities for new developments in North America, mining companies and other entities have been exploring investment prospects in regions like Latin America and the Middle East.
Companies worldwide have been exploring various avenues to make Bitcoin mining less arduous on the environment while keeping expenses low. Cumulus Data, a subsidiary of Talen Energy, is one such example. Cumulus announced the completion of the Cumulus Susquehanna data center in Pennsylvania. This unique 1200 acre campus facilitates nuclear-powered Bitcoin mining and cloud computing services.
The data center benefits from its direct connection to the 2.5-gigawatt Susquehanna nuclear power station in northeast Pennsylvania, allowing it to generate 48 megawatts of power.
As the Bitcoin network continues to strengthen, the search for affordable energy for mining purposes is expected to intensify. Recent data from Blockchain.com reveals that Bitcoin’s mining difficulty level surged by 3.4 per cent on Thursday, reaching a new all-time high. Simultaneously, the hashrate, indicating the computing power of the network, also hit a record-breaking 376 exahashes per second.
.
Follow Joseph Morton on Twitter
joseph@mugglehead.com
